# In the matter of Precision Fasteners Ltd. MA 1007/2018, MA 751/2019 in C.P. No. IB)1339(MB)-2017

> NCLT judgment dated 2019-05-08. Citation: TCN-2019-NCLT-03413. The case involves an application (MA 1007/2018) filed by the Liquidator under Section 60(5)(c)…

- **Court:** NCLT
- **Order date:** 8 May 2019
- **Citation:** TCN-2019-NCLT-03413
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/precision-fasteners-ltd-ma-10072018-ma-7512019-in-cp-no-ib1339mb-2017-1d33be7e

## Summary

### Background

The case involves an application (MA 1007/2018) filed by the Liquidator under Section 60(5)(c) of the Insolvency and Bankruptcy Code (IBC), 2016, seeking directions regarding respondents occupying flats owned by the Corporate Debtor in Gurudev Co-op Housing Service Society. The Corporate Debtor was registered as a sick company with the Board for Industrial & Financial Reconstruction (BIFR) in 2003. The Liquidator issued notices to the occupants to vacate the flats. Some occupants complied, but Respondents 1, 2, and 4 continued to occupy the flats. Respondent 4 claimed possession based on a letter from the Corporate Debtor's manager, stating he was given possession until his dues were paid.

## Facts

The Liquidator filed an application (MA 1007/2018) under Section 60(5)(c) of the IBC, seeking directions regarding occupants of flats owned by the Corporate Debtor. The Corporate Debtor, registered as a sick company with BIFR since 2003, owns 17 flats in Gurudev Society. The Liquidator issued notices to vacate, and some occupants complied. Respondents 1, 2, and 4 continued to occupy flats E7, B-9, and D-11, respectively. Respondent 4 claimed possession of flat D-11 based on a letter from the Corporate Debtor's manager, K.N. Disley, stating he was given possession until his dues were paid for providing laborers. The Liquidator admitted Respondent 4's claim as an operational debt. Respondents 1 and 2 did not file objections despite being served notice. The Liquidator

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## Issues and analysis

### Issue 1: Whether the letter issued by the Manager of the Corporate Debtor to Respondent No. 4 constitutes a …

**Ratio:** A letter of possession for an interim period until dues are paid does not constitute a

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**Reasoning:** The court reasoned that the letter from the Corporate Debtor's manager to Respondent No.

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**Interpretation:** The court interpreted the letter as merely granting temporary possession

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**Application:** The court applied this principle to the facts, concluding that Respondent No. 4

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## Parties

- **Judges:** V. P. S…; Ravikumar…; +1 more
- **Appellants:** Alchemist Asset…
- **Respondents:** Precision…

## Timeline

- **2017-01-01 — C.P. No.(IB)1339(MB)/201…**: Filing of C.P.…
- **2018-01-01 — MA 1007/…**: Filing of MA 1007/2018…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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